Peter Haytaian
About Peter Haytaian
Executive Vice President and President of Carelon and CarelonRx at Elevance Health (ELV). He is one of the company’s named executive officers, with compensation tied to enterprise performance via the Annual Incentive Plan (AIP) and long-term equity awards . Elevance Health’s 2024 operating revenue was $175.2B (+3% YoY) and operating gain was $7.9B; $4.4B was returned to shareholders via buybacks/dividends, and medical membership ended at ~46M, providing the performance backdrop for NEO pay decisions . Company pay-versus-performance shows variable executive pay moves with TSR and stock price; 2024 TSR (value of $100) was 130 for ELV vs 147 for the peer index, while Adjusted Net Income was $7,694M and GAAP Net Income $5,980M .
Past Roles
Not disclosed in the latest DEF 14A; the proxy identifies Haytaian’s current role as EVP and President of Carelon and CarelonRx (NEO list) .
External Roles
Not disclosed in the latest DEF 14A for NEOs .
Fixed Compensation
Multi-year cash compensation and bonus outcomes:
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $919,231 | $944,231 | $950,000 |
| Actual AIP (Bonus) Paid ($) | $1,323,692 | $1,314,369 | $406,980 |
AIP target and payout mechanics (2024):
- Target bonus as % of salary: 120% .
- Final 2024 AIP payout: $406,980, equal to 35.7% of target; most NEOs paid at 35.7% due to enterprise results and the 92.5% relative peer modifier .
Performance Compensation
Annual Incentive Plan (AIP) – 2024 performance scorecard and outcomes:
| Metric | Weight | Target | Actual 2024 | Result |
|---|---|---|---|---|
| Adjusted Net Income | 50% | $8,644M | $7,677M | Missed threshold |
| Operating Revenue | 20% | $170,200M | $173,349M | Exceeded target |
| Improving the Health of Humanity | 10% | Composite target (see sub-metrics) | Above target overall | Exceeded target |
| • High-Performing Providers | — | +1.5 ppt vs 2023 | +1.9 ppt | Above target |
| • Community Engagement | — | +1.0 ppt vs 2023 | +7.5 ppt | Above target |
| • Maternal & Child Health disparity | — | +5.0 ppt improvement | 6.9 ppt decline | Below target |
| Star Ratings | 10% | +33.5 ppt vs 2023 | −2.0 ppt | Missed threshold |
| Consumer Effort | 10% | +2.0 ppt vs 2023 | +1.9 ppt | Missed target |
| Relative Peer Modifier | — | 100% baseline | 92.5% (3rd of 6 on Adj NI growth, 6th of 6 on revenue growth) | 92.5% applied |
Long-Term Incentive Plan (LTIP)
- 2024 award design: mix of PSUs (60% Adjusted Net Income cumulative 3-yr; 40% Operating Revenue cumulative 3-yr), stock options (10-year term; vest 1/3 annually), and RSUs (vest 1/3 annually) .
- 2024 grant values for Haytaian: PSUs $2,399,721; Options $1,199,997; RSUs $1,200,360; Total $4,800,078 .
- 2024 LTIP share/option specifics: 4,808 target PSUs (2024–2026), 2,405 RSUs, 9,280 options at $499.11 strike (3/1/2024 grant) .
- 2022–2024 PSU payout certified at 95.1% of target based on cumulative performance (Adj NI and Operating Revenue) .
- 2025 change: PSUs will use 3-year cumulative Adjusted Diluted EPS (replacing Adjusted NI) alongside Operating Revenue to better align with shareholder priorities .
Equity Ownership & Alignment
Beneficial ownership, guidelines, and restrictions:
- Beneficial ownership: 104,782 shares (98,265 owned plus 6,517 supplementally owned/vesting within 60 days). No individual director/NEO owns ≥1% of shares outstanding .
- Stock ownership guideline (EVP): 3.0x base salary; company states all NEOs meet their guideline; unvested RSUs count toward compliance; unvested PSUs and unexercised options do not .
- Hedging, pledging, short sales prohibited; 10b5‑1 trading plans allowed only with strict pre-approval and “cooling-off” requirements .
Outstanding equity and vesting cadence (selected details):
- Options outstanding include multiple tranches with strike prices from $166.97 to $499.11 and expirations through 3/1/2034; 9,280 options from 2024 grant vest equally in 2025–2027 .
- RSU/PSU vesting schedule (shares scheduled by year, excluding performance outcomes for future PSUs):
| Year | RSUs (scheduled vest) | PSUs (scheduled vest) |
|---|---|---|
| 2025 | 2,304 | 4,213 (2022–2024 PSU payout accrued; vests in 2025) |
| 2026 | 1,566 | 4,584 (2023–2025 target units; vesting subject to performance) |
| 2027 | 802 | 4,808 (2024–2026 target units; vesting subject to performance) |
Insider selling pressure signals
- 2024 equity realization: exercised 15,000 options for $4,998,150 and vested 15,779 shares valued at $7,760,160, indicating meaningful equity monetization in the year .
- Retirement-eligibility treatment applies to Haytaian for equity upon qualifying separations, affecting vesting/continuation; see Employment Terms .
Employment Terms
Executive Agreement Plan (EAP) summary for Haytaian (retention, severance, CoC, restrictive covenants):
- Restrictive covenants: 24-month post-termination non-compete and non-solicit; ongoing confidentiality and non-disparagement; violations trigger clawback of severance and equity gains from the prior 24 months .
- Change in Control (double trigger): If terminated without cause/for good reason post-CoC, cash severance = 300% of (salary + target AIP) for Haytaian; plus 5% retirement-plan value, AIP for year of termination (greater of target or actual), 300% of annual DEC benefit, and 3 years of health/life coverage; unvested equity vests (PSUs at 100% of target) .
- Non-CoC termination without cause/for good reason: cash severance = 200% of (salary + target AIP); 2 years of health/life coverage; continued vesting of options/RSUs during severance period (or retirement treatment if eligible); pro‑rata PSUs based on actual performance .
- Potential payout magnitudes (illustrative as of 12/31/2024):
- CoC termination: Total estimated $14,682,951 .
- Non‑CoC without cause/for good reason: Total estimated $9,677,657 .
- Death/LTD: $7,229,417 (largely equity acceleration at assumed price) .
Clawbacks and pay governance
- Clawback policy meets SEC restatement standards and extends to discretionary recoupment for restrictive covenant breaches or misconduct causing financial or reputational harm .
- Hedging/pledging prohibitions, strong stock ownership/holding requirements, and no excise tax gross‑ups; change-in-control benefits are double‑trigger only; no stock option repricing without shareholder approval .
Deferred compensation and perquisites (alignment and risk)
- 2024 non-qualified deferred comp: $105,362 executive contributions; $95,969 company match; year-end balance $1,833,121 .
- 2024 perquisites/other comp included security-related benefits, DEC ($15,000 cash credits + $15,000 core credits), 401(k) and deferred comp match, and $8,637 tax equalization; total “All Other Compensation” $188,069 .
Compensation Structure Analysis
- Mix shifts: Base salary held flat ($950k); 2024 AIP fell to $406,980 (35.7% of target) reflecting missed threshold on Adjusted Net Income and weaker Star Ratings/Consumer Effort; LTIP grant value modestly higher YoY ($4.800M vs $4.300M in 2023), maintaining a heavy tilt to long-term equity .
- AIP rigor: 2024 relative peer modifier cut payouts to 92.5% of calculated funding (3rd/6 on Adj NI growth; 6th/6 on revenue growth vs peers), demonstrating peer-relative discipline .
- LTIP metrics: Continued emphasis on multi-year Adj NI and revenue through 2024 grants; pivot to 3‑year Adjusted Diluted EPS for 2025 grants increases focus on per‑share earnings power and investment discipline .
- Market benchmarking: Total compensation targeted at median versus two comparator groups (direct industry peers including Centene, CVS, Humana, Cigna, UnitedHealth, and a Fortune 50 general industry set); Willis Towers Watson engaged as independent consultant with no identified conflicts .
Equity Ownership & Alignment (Detail Table)
| Item | Detail |
|---|---|
| Beneficial Ownership | 104,782 shares (98,265 owned; 6,517 supplementally owned/vesting within 60 days); no NEO ≥1% ownership |
| Options (selected) | 9,280 options @ $499.11 (3/1/2024 grant) vest 2025–2027; additional older tranches outstanding with strikes $166.97–$469.03 and expirations through 3/1/2034 |
| RSUs | 2024 grant 2,405 units (vest 1/3 each year); upcoming scheduled RSU vests: 2,304 (2025), 1,566 (2026), 802 (2027) |
| PSUs | 2024 grant 4,808 target units (2024–2026); 2022–2024 PSUs paid at 95.1% of target (vested 2025) |
| Ownership Guidelines | EVP requirement 3x salary; NEOs meet guideline; 100% of after-tax profit shares must be held until met |
| Hedging/Pledging | Prohibited for directors and executive officers |
Performance & Track Record (Company context for incentive alignment)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Operating Revenue ($B) | — | — | 175.2 |
| Operating Gain ($B) | 8.283 (segments) | 8.499 (segments) | 7.862 (segments) |
| GAAP Net Income ($M) | 5,894 (recast) | 5,987 | 5,980 |
| Adjusted Net Income ($M) | 6,927 | 7,868 | 7,694 |
| TSR ($100 initial, year-end) | 176 | 164 | 130 |
- Strategic context: 2024 saw scaling of Carelon (health services) and expansion of CarelonRx’s customer base, plus acquisitions in home health and infusion services; these initiatives underpin long-term growth drivers central to Haytaian’s operating remit .
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑Pay approval: ~92% of votes cast in favor at 2024 meeting; the Board continues annual frequency based on shareholder preference .
- Governance practices include independent consultant, clawback (including reputational harm), double-trigger CIC, and prohibition on hedging/pledging .
Employment Terms (Detail Table)
| Scenario | Cash Severance | Year-of-Term AIP | Equity | Benefits/Other | Total (as of 12/31/24) |
|---|---|---|---|---|---|
| CIC termination (double-trigger) | $6,583,500 | $1,140,000 | $6,822,437 (incl. PSU @ 100% target) | DEC 300%, 3 yrs health/life; +5% plan match | $14,682,951 |
| Non‑CIC (w/o cause or good reason) | $4,180,000 | $406,980 | $4,996,751 (pro‑rata PSU; continued vesting) | DEC 200%, 2 yrs health/life | $9,677,657 |
| Death/LTD | — | $406,980 | $6,822,437 | — | $7,229,417 |
Restrictive covenants: 24‑month non‑compete/non‑solicit; violations trigger repayment and equity clawback .
Investment Implications
- Pay-for-performance alignment: 2024 AIP paid at 35.7% of target for Haytaian amid missed Adj NI threshold and Star Ratings headwinds, showing downside sensitivity; LTIP remains the majority of pay with multi-year metrics (now shifting to Adjusted Diluted EPS) that reinforce long-term earnings quality and growth .
- Ownership/retention: Meaningful vested/unvested equity and strict ownership/holding rules promote alignment; retirement eligibility and EAP with double-trigger CIC reduce abrupt departure risk but create defined severance economics; hedging/pledging bans and robust clawbacks mitigate governance risk .
- Near-term selling pressure: Scheduled RSU/PSU vests through 2027 and 2024 option grants vesting 2025–2027 may create periodic liquidity events; 2024 realized exercises (15,000 options) highlight ongoing monetization potential typical for senior executives .
- Execution focus: Company-level targets emphasize Adj NI/Revenue, consumer experience, Star Ratings, and health equity; 2024 results were mixed (revenue beat, quality metrics lag), informing 2025’s strategic-initiative AIP focus and LTIP metric shift to EPS—key determinants of Haytaian’s future payouts given his responsibilities over Carelon and CarelonRx .